HHS awarded $24.8M for IT infrastructure support, with 4 bidders competing for a 3-year contract

Contract Overview

Contract Amount: $24,775,169 ($24.8M)

Contractor: Paragon Technology Group Inc.

Awarding Agency: Department of Health and Human Services

Start Date: 2015-02-17

End Date: 2018-02-16

Contract Duration: 1,095 days

Daily Burn Rate: $22.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: IGF::OT::IGF, NON R&D - SERVICE DESK SUPPORT, INFRASTRUCTURE OPERATIONS AND MAINTENANCE.

Place of Performance

Location: BETHESDA, MONTGOMERY County, MARYLAND, 20892

State: Maryland Government Spending

Plain-Language Summary

Department of Health and Human Services obligated $24.8 million to PARAGON TECHNOLOGY GROUP INC. for work described as: IGF::OT::IGF, NON R&D - SERVICE DESK SUPPORT, INFRASTRUCTURE OPERATIONS AND MAINTENANCE. Key points: 1. The contract value of $24.8 million over three years suggests a moderate annual spend for IT infrastructure services. 2. With 4 bidders, the competition level indicates a reasonably contested market for this type of service. 3. The firm-fixed-price contract type aims to control costs by shifting risk to the contractor. 4. The contract was awarded under a BPA Call, suggesting it leveraged an existing framework agreement. 5. The North American Industry Classification System (NAICS) code 541519 points to a broad category of computer-related services. 6. The contract's duration of 1095 days (3 years) provides a stable period for service delivery. 7. The small business set-aside flag is false, indicating it was not specifically targeted for small businesses.

Value Assessment

Rating: good

The contract value of approximately $8.26 million per year for IT infrastructure operations and maintenance appears reasonable when benchmarked against similar federal contracts for IT support services. The firm-fixed-price structure helps in predictable budgeting. Without specific per-unit cost data, a direct comparison is limited, but the overall award amount aligns with the scope of services typically provided under such agreements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, with four bidders vying for the opportunity. The presence of multiple bidders suggests a healthy level of market interest and competition for IT infrastructure support services within the federal space. This competitive environment generally leads to better price discovery and potentially more favorable terms for the government.

Taxpayer Impact: The full and open competition ensures that taxpayers benefit from a market-driven price, as multiple companies competed to offer the best value. This process helps prevent overpayment and encourages efficiency from the winning contractor.

Public Impact

The National Institutes of Health (NIH) benefits from reliable IT infrastructure operations and maintenance, ensuring the continuity of its research and administrative functions. The contract supports essential IT services, including help desk support and infrastructure upkeep, critical for the daily operations of a major federal health agency. The primary geographic impact is within Maryland, where the agency is located, supporting its on-site and potentially remote workforce. The contract likely supports a workforce of IT professionals responsible for service desk operations, network management, and system maintenance.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in if the incumbent contractor's solutions become deeply integrated.
Risk of service degradation if contractor performance monitoring is not robust.
Dependency on a single contractor for critical IT infrastructure could pose a risk if the contractor faces financial or operational difficulties.

Positive Signals

The firm-fixed-price contract type incentivizes contractor efficiency and cost control.
Full and open competition suggests a competitive market, potentially leading to better value.
The contract duration provides stability for service delivery and planning.

Sector Analysis

This contract falls within the Information Technology sector, specifically focusing on IT services, infrastructure operations, and maintenance. The market for federal IT services is substantial, with agencies consistently investing in maintaining and upgrading their technological capabilities. This contract represents a typical expenditure for a large federal agency like NIH, aiming to ensure the smooth functioning of its critical IT systems and support its mission-critical operations.

Small Business Impact

This contract was not set aside for small businesses, as indicated by the 'sb: false' flag. Therefore, it did not directly provide opportunities for small business set-asides. However, the prime contractor, Paragon Technology Group Inc., may engage small businesses as subcontractors to fulfill certain aspects of the contract, depending on their subcontracting plans and the specific requirements of the work.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the program office within the National Institutes of Health. Performance would be monitored against the terms and conditions of the firm-fixed-price contract, including service level agreements. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

IT Infrastructure Support Services
IT Operations and Maintenance
Help Desk Services
Federal IT Services Contracts
Department of Health and Human Services IT Spending

Risk Flags

Potential for vendor lock-in
Reliance on contractor performance
Cybersecurity risks

Frequently Asked Questions

What is this federal contract paying for?

Department of Health and Human Services awarded $24.8 million to PARAGON TECHNOLOGY GROUP INC.. IGF::OT::IGF, NON R&D - SERVICE DESK SUPPORT, INFRASTRUCTURE OPERATIONS AND MAINTENANCE.

Who is the contractor on this award?

The obligated recipient is PARAGON TECHNOLOGY GROUP INC..

Which agency awarded this contract?

Awarding agency: Department of Health and Human Services (National Institutes of Health).

What is the total obligated amount?

The obligated amount is $24.8 million.

What is the period of performance?

Start: 2015-02-17. End: 2018-02-16.

What is the track record of Paragon Technology Group Inc. with federal contracts, particularly within the Department of Health and Human Services?

Paragon Technology Group Inc. has a history of performing federal contracts, including work with the Department of Health and Human Services (HHS). Analyzing their past performance data, including contract values, types, and customer satisfaction ratings (if available), would provide insight into their reliability and capability. For this specific contract, their performance over the 3-year duration would be a key indicator. Federal procurement databases often contain award histories and sometimes performance evaluations that can be reviewed to assess a contractor's track record. A review of their portfolio would reveal if they have consistently delivered on similar IT infrastructure and service desk support contracts for other federal agencies.

How does the awarded amount of $24.8 million compare to similar IT infrastructure support contracts awarded by NIH or other agencies of similar size?

The awarded amount of $24.8 million over three years, averaging approximately $8.26 million annually, appears to be within a reasonable range for IT infrastructure operations and maintenance services for a large federal agency like the National Institutes of Health (NIH). Benchmarking against similar contracts requires access to detailed data on scope, duration, and specific services rendered. However, general market analysis suggests that federal agencies allocate significant budgets to IT support. The firm-fixed-price nature of this contract also implies that the government sought predictable costs. Without specific comparable contract details, it's difficult to definitively state if it's high or low, but it doesn't immediately appear anomalous for the scope and duration.

What are the primary risks associated with this contract, and how are they being mitigated?

Key risks associated with this IT infrastructure support contract include potential service disruptions, contractor performance issues, and cybersecurity vulnerabilities. Mitigation strategies are embedded within the contract structure and oversight. The firm-fixed-price (FFP) contract shifts some financial risk to the contractor, incentivizing them to manage costs efficiently. Performance standards and Service Level Agreements (SLAs) are crucial for monitoring and ensuring quality of service. Robust cybersecurity protocols and regular audits are essential to protect sensitive data. The government's oversight through contract management, regular performance reviews, and the potential for corrective actions or termination for default are also critical risk mitigation measures.

How effective has the competition level (4 bidders) been in ensuring value for money for this specific contract?

The presence of four bidders for this contract suggests a competitive marketplace for IT infrastructure support services, which generally bodes well for value for money. A higher number of bidders typically leads to more competitive pricing and a wider range of innovative solutions. The firm-fixed-price contract type further enhances value by capping costs. To definitively assess effectiveness, one would need to analyze the pricing proposals submitted by each bidder and compare them against the government's independent cost estimates. However, the fact that the contract was awarded under full and open competition with multiple bids indicates that the government likely secured a competitive price point, preventing potential overspending that might occur in a sole-source or limited-competition scenario.

What is the historical spending trend for IT infrastructure support services at the National Institutes of Health?

Historical spending trends for IT infrastructure support services at the National Institutes of Health (NIH) generally show a consistent and significant investment. Agencies like NIH rely heavily on robust IT systems to support their extensive research, data management, and administrative functions. Spending in this area typically fluctuates based on technological advancements, infrastructure upgrades, and evolving security requirements. While the specific $24.8 million award is for a defined period, NIH's overall IT budget often encompasses a broad range of services, including network operations, data center management, end-user support, and cybersecurity. Analyzing NIH's budget appropriations and contract awards over the past 5-10 years would reveal patterns of increasing, decreasing, or stable spending in IT infrastructure support.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Other Computer Related Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › ADP AND TELECOMMUNICATIONS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 9417 GEORGETOWN PIKE, GREAT FALLS, VA, 22066

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Small Business, Small Disadvantaged Business, Special Designations, Subchapter S Corporation, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $24,775,169

Exercised Options: $24,775,169

Current Obligation: $24,775,169

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: HHSN268201300005B

IDV Type: BPA

Timeline